Murray & Roberts buys another 17% in Bombela, worth R405m
Murray & Roberts has completed the acquisition of a further 17% shareholding in the Bombela Concession Company (BCC) worth R405m, bringing its total stake in the Gautrain operating company to 50%.
"This acquisition was undertaken as part of Murray & Roberts’ broader capital allocation strategy," Henry Laas, group CEO, said on Friday.
BCC holds the 15-year concession for operating and maintaining the Gautrain system until March 2026. Murray & Roberts expected its investment would continue to provide strong returns in the short to medium term.
BCC is a special-purpose organisation appointed in 2006 by the Gauteng provincial government for the design, partial financing, build, operation and maintenance of the Gautrain. It implements its obligations through its concession agreement, which is held between the provincial government and BCC.
At the incorporation of BCC, Murray & Roberts held a 25% shareholding, and in 2011 its stake in BCC was increased to 33%.
All conditions precedent in relation to the transaction have been fulfilled and the effective date is December 8 2017. "We welcome the acquisition and are proud that BCC is now a wholly owned South African company," Jack van der Merwe, CEO of the Gautrain Management Agency said on Friday.
Subsequent to the settlement with provincial government of costly Gautrain construction disputes in December 2016, French construction group Bouygues and Canadian-based train and aircraft builder Bombardier, as part of their long-term investment plan, decided to divest from BCC.
They agreed to sell 8.5% each to Murray & Roberts and the balance of their shares to empowerment vehicle Strategic Partners Group and Calshelf, a part of the empowered J&J Group, who now hold 38% and 12% of BCC, respectively.
André van Rensburg, CEO of BCC said on Friday that the acquisition would help BCC increase local content in the Gautrain system.